History indicates wages will rise in Right to Work Missouri

On November 8, Big Labor’s favored gubernatorial and state legislative candidates got shellacked in Missouri, as voters rejected union bosses’ agenda of more and more monopoly privileges for themselves and ever-higher taxes for hardworking citizens.

Moreover, as the gubernatorial showdown between Right to Work advocate Eric Greitens and Big Labor apologist Chris Koster heated up in the months prior to Election Day, political observers of all stripes agreed the perpetuation of compulsory unionism was on the ballot in the Show-Me State.

A June 2016 article in the Kansas City Star bluntly acknowledged that the “huge” Big Labor support Mr. Koster was already receiving was largely due to his “vehement opposition to a right to work law ...” But after he was nominated in August, Greitens vowed again and again on the campaign trail to fight for passage of a state Right to Work statute.

By its own admission, Big Labor spent a total of $10.6 million to install Koster as governor. But voters ultimately backed the pro-Right to Work candidate for chief executive by a solid six percentage point margin. Voters also returned to office all Right to Work-supporting legislators in the Missouri House and Senate who sought re-election.

Because of the resounding defeat suffered by union bosses at the polls on Election Day, even hardened Right to Work foes now admit legislation banning the termination of employees for refusal to pay dues or fees to an unwanted union is very likely to become law in early 2017.

If Missouri does indeed become a Right to Work state, what will it mean for Show-Me State employees? The most important thing is that they will be free to refuse, without risking their jobs, to pay for union-boss services they don’t want and never asked for. But what effect will Right to Work have on their earnings?

History indicates that wages will rise in Right to Work Missouri. Since early 2012, four states have banned compulsory union dues, and in two of these states — Indiana and Michigan — unionism has now been voluntary for at least three years. What has happened to workers’ wages in these two states?

According to U.S. Bureau of Labor Statistics (BLS) data, the average weekly earnings for Indiana private-sector employees in March 2012, the month the Hoosier State’s Right to Work law took effect, were $732.48. In November 2016, the most recent month for which data are now available, the BLS estimates that the average weekly earnings of Indiana private-sector employees were $834.75.

In a little more than four-and-a-half years, then, weekly earnings per private worker in Indiana have risen by 14 percent, or 8.3 percent after adjusting for inflation, as measured by the BLS urban consumer price index. And this 8.3 percent real increase stands in stark contrast to the 0.7 percent decline in real weekly earnings for comparable Missouri employees over the same period.

The BLS data for Michigan, whose Right to Work law took effect in March 2013, tell a very similar story. From March 2013 through November 2016, real weekly earnings per private-sector employee in Michigan went up by 5.3 percent, while they declined by 0.7 percent over the same period for Missouri workers.

Since the 25th and 26th state Right to Work laws, adopted in Wisconsin early last year and West Virginia early this year, have only been in effect a very short time, it is too early to draw firm conclusions from the BLS data for these states. But it is worth pointing out that, so far, private sector weekly wage growth is also outpacing inflation in Wisconsin and West Virginia since they became Right to Work.

Unfortunately, the fact that, for years, the adoption of state Right to Work laws has been associated with wage gains outpacing inflation and the national average doesn’t deter self-interested union officials and their allies in the media and academia from predicting economic catastrophe if a state opts to make unionism voluntary.

Ordinary Missouri citizens who know in their hearts that it’s just plain wrong for any employee to be forced to bankroll a union as a job condition should simply ignore Big Labor predictions, which have never been borne out in the past, and, it is safe to say, never will be.

Stan Greer, Senior Research Associate, National Institute for Labor Relations Research